West Bromwich announces debt deal

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The West Bromwich Building Society has reached an agreement with debt-holders to boost its financial strength and avoid insolvency by converting of its £182.5m debt into equity.

The move will strengthen its core tier 1 capital ratio, giving it a greater buffer to absorb losses and avoid the business failing. The lender released a statement this morning announcing the deal. "The capital exchange will materially strengthen the Society's core tier 1 capital ratio from 6.8% to 11.6% on a pro-forma basis." West Brom said its core tier 1 capital ratio was now amongst the highest in the sector. The lender added that a 'back-to-basics strategy' would reposition the Society and focus it on its strong regional position and its core competencies of retail savings and ...

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